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Non Performing Assets Essay

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Below is an essay on "Non Performing Assets" from Anti Essays, your source for research papers, essays, and term paper examples.

Definition of 'Nonperforming Asset'
A debt obligation where the borrower has not paid any previously agreed upon interest and principal repayments to the designated lender for an extended period of time. The nonperforming asset is therefore not yielding any income to the lender in the form of principal and interest payments.

Investopedia explains 'Nonperforming Asset'
For example, a mortgage in default would be considered non-performing. After a prolonged period of non-payment, the lender will force the borrower to liquidate any assets that were pledged as part of the debt agreement. If no assets were pledged, the lenders might write-off the asset as a bad debt and then sell it at a discount to a collections agency.   

A loan or lease that is not meeting its stated principal and interest payments. Banks usually classify as nonperforming assets any commercial loans which are more than 90 days overdue and any consumer loans which are more than 180 days overdue. More generally, an asset which is not producing income.

Definition of 'Non-Performing Asset - NPA ' of banks
A classification used by financial institutions that refer to loans that are in jeopardy of default. Once the borrower has failed to make interest or principal payments for 90 days the loan is considered to be a non-performing asset.

Also known as “non-performing loan”.

Investopedia explains 'Non-Performing Asset - NPA '
Non-performing assets are problematic for financial institutions since they depend on interest payments for income. Troublesome pressure from the economy can lead to a sharp increase in non-performing loans and often results in massive write-downs.


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"Non Performing Assets". Anti Essays. 25 Jun. 2018


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Non Performing Assets. Anti Essays. Retrieved June 25, 2018, from the World Wide Web: https://www.antiessays.com/free-essays/Non-Performing-Assets-173463.html